Brightcove To Be Profitable In 12 Months, Wrong To Compare To Move Networks

A lot of sites are covering the launch of the new Brightcove platform today, but many seem to be missing a lot of the major new features of the release and instead, are focusing too heavily on an incorrect comparison to Move Networks. Seems to me that many folks are only looking at the press release and didn’t take the time to get a demo of the new features.

Last week I got to see the new platform in action and spent some time asking Jeremy Allaire, Brightcove’s CEO, some questions about their core customers. While Jeremy would not confirm the revenue numbers that I am hearing in the industry for Brightcove, he did say that Brightcove expects to be profitable in 12 months. He also stated that Brightcove has "over 400 premium customers" for their services.

The new Brightcove 3 platform that launched in beta with select customers, has some huge improvements over the previous platform. For starters, player load times have increased from 300-600% in the new platform. One of the biggest gripes I always had about using the Brightcove system is how long it would take the player to load on my website. Looking at some live sites already using the new system, I saw players loading in under 2 seconds. A vast improvement.

In addition, the Brightcove system will now let content owners choose whether they want to encode their content using H.264 or On2’s VP6 for what Brightcove calls "dynamic delivery". Very simply, dynamic delivery allows content owners to upload one video and have it transcoded to multiple bitrates. The result is that viewers get the best quality bitrate sent to them depending on their Internet connection. While some are saying this is a technology Move Networks created or adopted, RealNetworks introduced this technology, branded SureStream, back in 1998. Microsoft quickly followed suit with the same kind of technology branded as Intelligent Streaming in 1999. This idea of delivering the best file to the user, and encoding for multibitrate, is not new, but it is great to see Brightcove leverage it to make the end user experience better. For those who don’t know which to select, H.264 or On2’s VP6, Jeremy said the Brightcove system would make a default choice for them, but didn’t yet know what that default choice would be.

As some have mentioned, the new Brightcove system includes new APIs that enable more customization and more importantly, gives each video in the system their own unique URL. Another complaint of Brightcove users in the past was that the system was not really setup to be able to have search engines easily find the content. With the new system, that problem has been eliminated. The new APIs also allow a lot of customization over the way a video is presented and enables content owners to showcase related videos and drive up the number of videos consumed per viewer. Based on initial beta testers, they are seeing a large jump in the number of videos per user being played thanks to the new options for how the player and the surrounding content is presented. The new system has a drag and drop interface and as a Brightcove user, I can see some tasks that use to take me six or seven steps, now only taking one or two. The new Brightcove 3 system will be free to all premium users, but those who share revenue with Brightcove based on an advertising model, which is a small segment of Brightcove’s business, will have to wait for a newly packaged product offering.

While many are comparing the new Brightcove 3 platform to Move Networks technology, they have almost nothing in common, aside from both companies aiming for high-quality. At no time during my call with Jeremy did he call out Move or even mention them as a competitor. And the new features and functionality that the Brightcove 3 system now has, are relevant to all content owners, not just those with long-from content like some are speculating.

As a company, Brightcove has it’s roots in being a provider to enable content owners to use video for marketing and promotion, as opposed to Move who focuses on the deep needs of broadcasters. Brightcove is not doing anything at the network and infrastructure layer, not doing what Move does with QoS, not providing automation controls and does not getting hands-on with the broadcasters technical infrastructure teams. On the other hand, Move is not out in the market with their own portal or syndication strategy and not going after customers who all need the same publishing system. Brightcove and Move are two very different companies, going after very different customers, who also have very different levels of traffic. Many of Move’s content customers are delivering prime time content, to hundreds of thousands of simultaneous viewers, which is different from content owners using the Brightcove system. One is not better than another, both work well to fill two different demands in the market, but they are very different solutions.

Added: Another difference between Brightcove and Move Networks that I forgot is that Move Networks support live streaming. Something many broadcasters require.

Frankly, with all due respect, this is hard to believe given the huge amount of FUD this company has spewed.

http://www.BusinessOfVideo.com Dan Rayburn

NOTE: A reader wants to keep leaving comments on this post, in reference to a different blog about a different company other than Brightcove that he has stock in. If you want to comment about my Brightcove post, on my blog – go right ahead. I won’t censor it.
But if you want to use my blog, to complain about a different blog, and a different company than I even wrote about, that I won’t allow.

http://www.ramprate.com Steve Lerner

Great to see improvements in video syndication and management platforms!
But for all those finance people reading this looking for clues- the hyper-reductionist summary is
Move Networks = Delivery Technology
BrightCove = Syndication Technology
They are not competitors. They are not in the same part of the value chain.

insider

ok, ok, jeremy allaire made some comment about “profitable in 12 months” so i suppose you felt you needed to print that
but that is absolutely worthless drivel
sure, maybe brightcove will be profitable in 12 months
maybe they won’t
how will anyone know?
unless these startup ceo’s are willing to release actual numbers and projections (duh they never will and why should they?) then journalists and bloggers should stop printing the drivel

http://www.BusinessOfVideo.com Dan Rayburn

How will anyone know? Simple. Ask Brightcove in 12 months time if they are profitable or not. They are not going to say to the market they are if they aren’t as investors would not stand behind that. Plus, it’s pretty easy for someone who has a close relationship with Brightcove’s investors to find out if the company is profitable when they say they are. If they are not profitable by the time they say, then that by itself is a story. Why aren’t they and what happened to the business to prevent it?
But instead, you’d rather have me not mention it at all and pass judgement on the statement because it “might” not happen. That’s stupid. I’m reporting, from what I can tell, the first time Brigthcove has stated to the public when they will make money. That’s an important statement to put out there. No where did I say it will or will not happen, I’m simply reporting it. None of us will know for a year whether the statement is accurate or not.

brandon

No way they are profitable in 12 months. I’ll be incredibly surprised if they don’t have to raise more money in the next year. Of the 400 premium customers, I wonder how many are actually paying. They had a habit of giving away services for awhile.

http://www.visin.com Tom Townsend

I like Bright Cove and the improvements will be well received. However, since they don’t publish their numbers and pricing fees as compared to others, it is a bit of speculation on their part to make such a bold statement of profitability in 12 months. But then again, I guess they have to say it to keep the investor money coming in.

Paul

How will we ever see these developments if they are just opening it up at the moment to only very few companies who are using it at the moment?
I agree that video is the most engaging form of online media today, and it only looks like it is set to get bigger. It seems though, that the concept of using social networking and video for businesses to increase engagement and enhance communication, both externally and internally, has not really reached its full potential. Brightcove are not the only company to have created a platform that offers this service, even with their new release. With regards to profitably, this must have some reflection on that fact.http://www.brandstation.tv/

http://www.MatthewMamet.com Matthew Mamet

In interest of full disclosure, I work for PermissionTV.com, a competitor to Brightcove and partner to Move. Based on my experience working at PTV and seeing all this technology day to day, I agree that it’s wrong to compare Brightcove to Move Networks. Move will always stay focused as a delivery company. More importantly, Brightcove’s eventual release of server-side API to the public will be a good move for them. It’s something that PTV has had in place for 6 months and our clients really enjoy the flexibility of being able to build custom players ontop of our platform. With respect to being profitable in 12 months, I wish them all the best. It’s obviously a good goal to reach, and they’re good, smart people over there.

Anthony

As everyone knows by now, video is very exciting. I think in the next few years people will discover that video is appropriate for certain areas of the consumer market, right now it seems like everyone wants to use video for everything. I think the small business arena will benefit the most from video which is pretty much the thesis behind Jippidy.com

Daily posts by Dan Rayburn about the online video industry, business trends & analysis, market data & research as well as the online video business models in the media & entertainment, broadcast, advertising & enterprise industries.